Pending home sales index rises again in November

Saturday

Dec 29, 2012 at 2:00 AM

The Associated Press

The Associated Press

WASHINGTON — A measure of Americans who signed contracts to buy homes increased last month to its highest level in two and a half years, the latest sign of improvement in the once-battered housing market.

The National Association of Realtors said Friday that its seasonally adjusted pending home sales index rose 1.7 percent in November from October to 106.4. That's the highest since April 2010, when a homebuyer tax credit caused a spike in sales. And after excluding those months when the tax credit was available, it's the best reading since February 2007.

The increase followed a 5 percent gain in October and suggests higher sales of previously occupied homes in the coming months. There's generally a one- to two-month lag between a signed contract and a completed sale.

In Orange County, N.Y., the number of single-family homes under contract has exceeded year-ago levels by a wide margin in recent months, suggesting that sales will jump in coming months. At the end of November, there were 519 homes under contract in Orange County, up 47 percent from 353 a year ago, according to the Hudson Gateway Multiple Listing Service.

Signed contracts to buy homes rose last month in the Northeast and West, and ticked up slightly in the Midwest. They were unchanged in the South.

Home sales are on track to rise 10 percent this year to their highest level in five years, buoyed by ultralow mortgage rates and steady job gains. The Realtors' group forecasts that sales might rise in 2013 to about 5.1 million. That's still below the more than 5.5 million that is considered consistent with a healthy market.

The housing recovery that began earlier this year is looking sustainable for a number of reasons. The supply of previously occupied homes for sale has finally thinned out and is at an 11-year low. At the same time, more people are looking to buy or rent a home after living with relatives or friends during and in the aftermath of the Great Recession.

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